According to the recently-re-released Gareth Morgan KiwiSaver (GMK) prospectus, KiwiBank's first move will be to tack on a fourth investment option to the scheme.

The new CashPlus option will join the existing conservative, balanced and growth choices on the GMK investment menu this June. Adding a KiwiSaver cash account is, naturally, a no-brainer for a bank, which can recycle money into its central coffers and rack up some margin.

For instance, the country's single largest KiwiSaver scheme, ASB, reported as at March last year about $373 million of the total $1.5 billion was invested in a related party cash trust.

From my reading of the revised GMK rules, which now allow the manager to enter related party transactions, KiwiBank could take on up to 50 per cent of the CashPlus investments - and half of all GMK cash investments for that matter.

The new GMK prospectus, dated April 2, sets the fees for the CashPlus portfolio at 0.9 per cent for investment sums up to $20,000 and 0.7 per cent if the balance exceeds that. That doesn't sound very cheap to me for running a cash account, even if it's a 'plus', but it could've been worse. In what looks like a last-minute change of heart, the original 1 per cent CashPlus fee in the prospectus has been scratched out and replaced by 0.9 - 10 basis points is 10 basis points.

But the GMK fees are remarkably flat across all investment options anyway, currently set at 1 per cent for conservative, balanced and growth (this covers trustee and manager fees only, other costs are charged elsewhere).

Other points of interest in the revised GMK prospectus show the unit-price hating scheme has invested 15 per cent of the conservative fund, 31 per cent of the balanced fund and 52 per cent of the growth fund in unit trusts.

Up to 30 per cent of the CashPlus fund will probably be placed in unit trusts too, the prospectus states.

The new Gareth Morgan investments ownership structure was also formally put in place at the beginning of April.

GMK and the other Gareth Morgan private portfolio investments are now wholly-owned by Kiwi Wealth Management, a new entity established in March by Kiwi Group Holdings (owner of KiwiBank), which in turn is owned by NZ Post whose ultimate shareholdings are attributed to the Minister of Finance and the Minister of State Owned Enterprises - ie you and me.

David is a freelance journalist who has covered the financial services business on both sides of the Tasman for over 15 years. He is the editor of industry website Investment News. David has edited magazines and websites for the financial advice, investment and superannuation industries.